Coronavirus and National Healthcare Rationing

“Flattening the curve.” Those three words describe the motivation that many governments in Europe and several state governments within the United States have used to justify shutting down nearly all commerce and public gatherings within their jurisdictions as they seek to slow the rapid spread of coronavirus infections to keep from overwhelming their limited health care resources.

How much curve-flattening is necessary to avoid overloading a nation’s healthcare system? The answer has a lot to do with the system’s capacity.

For the COVID-19 coronavirus pandemic, most moderate-to-severe cases require patients be hospitalized in critical-care facilities, where the limiting resource is the number of beds available. Statista’s Niall McCarthy produced a “Chart of the Day” showing the available capacity of critical care beds in several nations.

A good question to ask is, why are so many of these nations so at risk of having their healthcare systems overwhelmed by coronavirus patients that elected government officials are very willing to throw their economies directly into recession with little-to-no public debate?

The answer is that most counties have either nationalized healthcare systems or single-payer systems that have chronically underinvested in their critical-care infrastructure in order to hold down their government’s healthcare costs.

Now they are having to adopt extreme measures in a desperate attempt to flatten their curves because they have all but ensured the inevitable failure of their healthcare systems to handle the pandemic.

Of all these systems, America’s heavily government-subsidized system is the one most open to market forces, which has enabled it to have the most investment per capita in the kind of critical care expected to be in heavy demand as the coronavirus spreads.

The nature of the viral infection will strain and perhaps overwhelm the U.S. healthcare system, but compared to other countries’ systems, it has the most capacity to be consumed before the breaking point might be reached.

It could be worse for the United States. In January 2020, Laura C. Myers, Gabriel Escobar and Vincent X. Liu shed light on the issue by publishing the journal article, “Goldilocks, the Three Bears and Intensive Care Unit Utilization: Delivering Enough Intensive Care But Not Too Much. A Narrative Review.” In it, they recognized that the high costs of critical care units are a high-visibility target for policymakers seeking to reduce the costs of American health care:

Intensive care units may be an attractive target for curbing healthcare spending in the United States. Experts have proposed reducing the supply of intensive care unit beds as one potential intervention to decrease cost [3,4,5]. They argue that excess supply of critical care beds increases intensive care unit use by patients who may not benefit from it.

In the coronavirus pandemic, such excess supply will give doctors the flexibility needed to accommodate larger numbers of patients requiring critical care, giving American hospitals options that other nations do not have. Myers et al. focus their discussion on how to triage patients to make maximum effective use of these still-limited critical-care resources within the United States.

Market forces provide powerful tools for allocating scarce resources to provide the greatest value. The more we use them, the better off we will fare.